Controversy brewing in beverage business
Some Alaska brewery owners are concerned about a legislative amendment that reduces the amount of alcohol they can sell.
On Friday, the House Labor and Commerce Committee passed an amendment to Senate Bill 76 that would cut the number of ounces breweries and distilleries can sell by one-third.
For breweries that means a reduction from 36 ounces to 24 ounces; distilleries would go from three ounces of hard liquor to two ounces.
Girdwood Brewing Company opened about a year ago. Cofounder Josh Hegna said they wanted a tasting room that was a central point for the community.
“I have kids in this town. I work as school librarian in this town. We really want to have a strong reputation and the community has been behind us,” Hegna said.
Breweries already have a number of restrictions like no entertainment like live music, no televisions and they have to stop serving by 8 p.m.
Hegna said further reducing how much beer they can sell is an overreach by the Legislature.
“We started our business a year ago under the idea that we could have this model in place, the 36 ounces. We realized we couldn’t have a TV, we’re not lobbying for that kind of stuff, but for them to change the game midway through the game, it’s completely unfair,” he said.
Customers agree; they feel the craft brewing business is being unfairly scrutinized.
“It’s limiting a new industry, and I don’t think that’s beneficial to economic development locally here in Girdwood or statewide,” said Matt Szundy, a Girdwood local who visits the brewery about twice a week.
Representative Adam Wool from Fairbanks said the amendment was initially introduced in regards to distilleries because the three-ounce samples are some of the “top in the country.”
“We wanted to make it more in the middle of what other states are doing. Alaska has an alcohol problem; we’re introducing a whole new outlet for alcohol in these tasting rooms,” Wool said.
Rep. Wool said there were many comments in support of the amendment from people in the restaurant and bar industry. Wool himself owns the Blue Loon, a self-proclaimed “restaurant, bar, movie theater and concert venue” in Fairbanks.
He said bar owners were concerned breweries and distilleries were “mimicking” their business practices.
“I don’t think it’s going to hurt them, and if they get creative, they can probably increase revenue and use less product,” Wool said about distilleries.
Hegna said the industries shouldn’t be pitted against each other but rather work together to give customers what they want. He also said the market is changing and people are looking for fresh and local products.
“I think some people are threatened by success and they think by slapping us down maybe this traffic will go there-- and that’s not the case,” Hegna said.
Rep. Wool said the committee members changed part of the bill that would have required 80-percent of breweries' product to be sold wholesale, which will come out in breweries’ favor.
“A lot of the beverage people thought that was unfair because they can make beer and sell it by the glass all day long,” Wool explained.
While a brewery license costs substantially less than a bar/liquor license—a few thousand compared to upwards of $200,000—Hegna said there are still hefty expenses when it comes to equipment and supplies.
“The ongoing costs of grain and hops-- it’s a very expensive industry. We’re not making money hand over fist,” Hegna said.
He and other brewery owners are hopeful the amendment will get taken out before the final votes are taken for the bill.
“The public supports this but there are a few special interest groups that are really controlling. I’m optimistic this will not go down,” Hegna said.
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